BILL ANALYSIS                                                                                                                                                                                                    



                                                                    AB 1330


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          Date of Hearing:  May 20, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          1330 (Bloom) - As Amended April 27, 2015


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          Urgency:  No  State Mandated Local Program:  YesReimbursable:   
          No


          SUMMARY:  


          This bill establishes an annual energy efficiency resource  
          standard for every retail seller of electricity and every gas  
          utility, and requires the California Energy Commission (CEC) to  








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          convene a stakeholder process to determine how the energy  
          savings goals are measured and reported.  Specifically, this  
          bill: 


          1)Requires the Public Utilities Commission, in consultation with  
            CEC, to supervise the implementation of this bill by community  
            choice aggregators, electrical service providers, and  
            electrical and gas corporations


          2)Requires the governing board of each local publicly owned gas  
            utility, in consultation with the CEC to be responsible for  
            the implementation of this bill.


          3)Requires each electricity retail seller to annually increase  
            the amount of energy efficiency resources to achieve not less  
            than 1.5% per year by 2020, and not less than 2% by 2025, as  
            specified.  Requires the CEC in consultation with the Public  
            Utilities Commission (PUC) to adopt a cost limitation for each  
            retail seller to comply with this requirement.


          4)Requires each gas utility to increase the amount of  
            incremental energy savings so that the total amount of  
            incremental energy savings achieved in any given year amounts  
            to .75% of total natural gas consumption by 2020 and not less  
            than 1%  by 2025 as specified.


          5)Requires the energy savings of retail electricity sellers and  
            gas utilities to first come from disadvantaged communities.


          6)Requires all entities to annually file reports with the CEC as  
            specified.










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          FISCAL EFFECT:


          1)  Net increase of annual costs to the PUC of $ 421,243  
          (special fund) and four PYs.


            This bill adds some oversight task to the PUC but also shifts  
          some existing tasks to the CEC.  This figure represents the net  
          increase of the bills requirements.


          2) Increased annual cost of approximately $300,000 (Energy  
            Resources Program Account) for CEC to set targets, collect  
            data, and calculate savings for 44 publicly owned utilities.


          


          COMMENTS:


          1)Purpose.  According to the author, establishing an energy  
            efficiency resource standard will be a critical component in  
            meeting Californian's energy needs while at the same time  
            meeting the Governor's goals of increasing building efficiency  
            by 50%, increasing our renewable portfolio to 50% by 2030, and  
            reducing our greenhouse gas emissions by 80% by 2050.


            An energy efficiency resource standard is a policy that  
            requires utilities or other entities to achieve a specified  
            amount of energy savings through energy efficiency programs  
            within a specified timeframe. These standards can require  
            electricity savings, natural gas savings, or both.


          2)Governor's 2015 Inaugural Address.  In the Governor's  








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            Inaugural Address on January 5, 2015, he called on the  
            following goals to continue reducing greenhouse gas emissions  
            beyond 2020 and by 2030:



                     Increase to 50% our electricity derived from  
                 renewable sources (RPS).
                     Reduce today's petroleum use in cars and trucks by  
                 up to 50%.


                     Double the efficiency of existing buildings and make  
                 heating fuels cleaner.


                
          1)Background.  The PUC regulates ratepayer-funded energy  
            efficiency programs.  The PUC works with the investor-owned  
            utilities, other program administrators, and vendors to  
            develop programs and measures to transform technology markets  
            within California using ratepayer funds.  
            


            The program requires that the portfolio of activities be cost  
            effective.  The 2013-2014 energy efficiency program budgets  
            were slightly more than $2 billion.  This does not include  
            additional funding to support low income households, which  
            includes a billing discount and no-cost energy efficiency  
            improvements and appliances for qualified low income  
            households.


            Ratepayer-funded energy efficiency budgets are used to provide  
            incentives to encourage energy efficiency improvements over  
            and above current state energy efficiency regulations, conduct  
            research on areas where state efficiency standards can be  
            increased, measured and evaluated, marketing and outreach,  








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            government partnerships, and financing programs.


            California's publicly owned utilities administer similar  
            programs, also funded by their ratepayers.


            The CEC researches and ultimately adopts and enforces state  
            standards for building and appliance efficiency.  The CEC  
            establishes first that its requirements are cost effective  
            before the requirements take effect.  In some limited areas,  
            the CEC is preempted from establishing standards if the  
            Federal government has already enacted standards. 





          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)  
          319-2081